Mr. Carey Ford reports

PRECISION DRILLING MEETS ANNUAL CAPITAL ALLOCATION TARGETS AND PROVIDES FINANCIAL AND OPERATIONAL UPDATES

Precision Drilling Corp. has provided a series of positive updates, reflecting the strength of its financial performance and disciplined capital allocation strategy, including: (1) the achievement of its 2025 debt reduction target and year-end liquidity update; (2) commitment to its capital allocation framework; and (3) a financial and operational update.

2025 debt repayment and year-end liquidity update

Precision reduced debt by $101-million in 2025, achieving its annual debt reduction goal. As at Dec. 31, 2025, Precision's outstanding debt obligations included:

• $400-million (U.S.) -- 6.875 per cent unsecured senior notes due Jan. 15, 2029;
• $100-million (U.S.) drawn on the senior credit facility.

The company ended 2025 with a cash balance of approximately $85-million and total available liquidity of approximately $447-million.

Capital allocation framework update

Precision remains firmly committed to its long-term debt reduction target of repaying $700-million between 2022 and 2027 and reaching a sustained net debt to adjusted earnings before interest, taxes, depreciation and amortization leverage ratio1 of below 1.0 times. Over the past four years, the company has reduced its debt by $535-million and notably lowered its net debt to adjusted EBITDA leverage ratio, which it expects to be approximately 1.2 times as at Dec. 31, 2025.

During 2025, Precision returned $76-million to shareholders through share repurchases under its normal course issuer bid, meeting its annual target of allocating between 35 per cent and 45 per cent of free cash flow before debt repayments to share repurchases. As at Dec. 31, 2025, the company had 12,932,399 shares outstanding, compared with 13,779,502 as at Dec. 31, 2024, representing a decrease of 6 per cent.

For the past decade, Precision has prioritized its capital allocation plans, allocating $1.7-billion of its free cash flow to debt repayments and share buybacks, while investing over $1.5-billion in its fleet and completing two acquisitions. As at Dec. 31, 2025, its annual run rate interest expense is approximately $34-million (U.S.) compared with $104-million (U.S.) in 2016.

With a robust free cash flow outlook in 2026, the company plans to further reduce its debt while increasing its share buyback allocation. In February, it will provide specific capital allocation plans and targets for 2026.

Net debt to adjusted EBITDA leverage ratio is a non-generally accepted accounting principle measure. Please refer to page 41 of Precision's annual report for the year ended Dec. 31, 2024, for more information.

Financial and operational update

Financial results

Precision intends to release its fourth quarter 2025 results after markets close on Wednesday, Feb. 11, 2026. Fourth quarter drilling field margins in Canada and the United States are expected to align with previous guidance. With a closing share price of $98.49 on Dec. 31, 2025, share-based compensation expense for the fourth quarter and full year is expected to be approximately $6-million and $24-million, respectively, which also aligns with previous guidance. As demand for drilling rigs continues to primarily focus on Super Series rigs, the company decommissioned 31 of 215 marketable rigs across its global fleet in the fourth quarter and expects to recognize a non-cash asset charge of approximately $67-million in 2025. In the fourth quarter, it also expects a non-cash charge of approximately $17-million related to drill pipe as more complex drilling programs are reducing the useful life of this asset.

Operational activity

In Canada, Precision continues to experience elevated customer demand for its drilling services, driven by Super Series rigs equipped with Alpha technologies and EverGreen environmental solutions. While some customers deferred fourth quarter drilling plans to January, the average active rig count remained robust at 66. The company currently has 86 rigs active and expects its rig count to peak at 87 this winter drilling season, with its 32 Super Triples and 47 available Super Single rigs fully utilized.

In the United States, it averaged 37 rigs in the fourth quarter, reaching a peak of 40 active rigs. While oil rig activity continues to be challenged, the industry's natural gas rig count increased 21 per cent in 2025 as producers are becoming more constructive on liquefied natural gas offtake and domestic power demand. It has 37 rigs operating today and continues to have encouraging customer conversations that are expected to support modest activity increases in both oil and natural gas basins during the first quarter.

Internationally, Precision expects seven active rigs throughout 2026, with three operating in the Kingdom of Saudi Arabia and four in Kuwait. Its international operations provide a stable foundation for earnings and cash flow, supported by long-term contracts extending into 2027 and 2028. The company continues to evaluate international growth opportunities that meet its disciplined capital return thresholds, including potentially reactivating idle rigs.

As the company enters 2026, it expects continued high activity levels for its well service business with more than 115 service crews anticipated to be active in early January, and additional crews expected to be deployed as market conditions warrant.

Chief executive officer quote

Carey Ford, Precision's president and chief executive officer, commented: "Precision generated substantial free cash flow in 2025, allowing us to not only meet our debt reduction and share repurchase targets but also upgrade 27 of our Super Series rigs to meet the needs of our customers. With a durable free cash flow outlook, we plan to improve our capital returns to shareholders in 2026 by continuing to reduce debt and increasing the percentage of free cash flow returned directly to shareholders. I am proud of our people's commitment to Precision's high performance, high-value strategy, delivering exceptional services to our customers and increasing value for our shareholders."

About Precision Drilling Corp.

Precision is a leading provider of safe and environmentally responsible high performance, high-value services to the energy industry, offering customers access to an extensive fleet of Super Series drilling rigs. Precision has commercialized an industry-leading digital technology portfolio known as Alpha that utilizes advanced automation software and analytics to generate efficient, predictable and repeatable results for energy customers. Its drilling services are enhanced by its EverGreen suite of environmental solutions, which bolsters our commitment to reducing the environmental impact of its operations. Additionally, Precision offers well service rigs, rental equipment and camps all backed by a comprehensive mix of technical support services and skilled, experienced personnel.

Precision is headquartered in Calgary, Alta., Canada, and is listed on the Toronto Stock Exchange under the trading symbol PD and on the New York Stock Exchange under the trading symbol PDS.

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